Spirits distributor survives Jӓgermeister’s bid for second dismissal in Missouri distribution franchise law dispute.
Back in March we reported on Jӓgermeister’s successful bid to dismiss a lawsuit that Major Brands brought over Jӓgermeister’s attempt to terminate its Missouri distribution arrangement with Major Brands in order to consolidate its distribution nationally with Southern Glazer’s Wine and Spirits of Missouri. You can read our entry on this spirits distribution agreement and distribution agreement termination lawsuit here.
For those of you interested in pleadings on matters related to distributorship termination in franchise relationships, you’ll be interested in this complaint. The attorneys for Major Brands definitely put better effort and time into creating a complaint that met the standards the court found lacking in the prior version.
Here’s how the court’s opinion on the motion to dismiss this nine count new complaint against Jӓgermeister and Southern breaks down:
Counts 1 and 2 against Jӓgermeister seek a declaratory judgment that Jӓgermeister has no right to terminate Major Brands as a wholesaler of spirits under the Missouri Franchise law and that doing so violated the Franchise law because Jӓgermeister has not/did not establish good cause. You’ll recall this from the last motion as it was the argument based on the statute that lacked allegations as to the right to use the trademark – a particular persistent issue under Missouri’s Franchise laws for beer, wine and spirits brands. These claims are now sufficiently plead to survive the motion to dismiss.
Counts 3 and 4 (breach of contract and breach of the covenant of good faith and fair dealing, respectively). Since the complaint now properly alleges an oral agreement that included a “no termination without good cause” requirement, the pleading properly invokes breach of contract and these counts will not be dismissed.
Counts 5 and 6 (recoupment and unjust enrichment, respectively) against Jӓgermeister stand as the new complaint adequately pleads that Major Brands expended substantial money, time and labor in marketing and distributing Jӓgermeister’s brands in Missouri. The count for unjust enrichment fails as to Southern though, because legally, Southern cannot “take” the goodwill that Major created in Missouri and any goodwill established benefits Jӓgermeister and not Southern.
Counts 7 and 8 plead that Jӓgermeister and Southern interfered with Major Brands business expectancy with licensed retailers in the state. People pleading claims on behalf of liquor distributors will want to pay attention to this claim for tortious interference as many forget that this contractual relationship is attendant to the liquor distribution relationship and fail to plead it.
Finally, Count 9 pleads civil conspiracy against Jӓgermeister and Southern – that they had an agreement to act unlawfully by illegally terminating the distribution agreement between Jӓgermeister and Major. This cause of action seeks to hold both defendants jointly and severally liable for that. And the court ruled that it was sufficiently plead as well, meaning the case will proceed.
You can read the second amended complaint that is at issue in this case here.
You can read the judge’s opinion here.